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New Option Plays

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Call Options Plays
Put Options Plays
Strangle Options Plays
ATI None None
BA    
FXI    
RIMM    

New Calls

Allegheny Tech - ATI - cls: 102.59 change: +0.23 stop: 97.45

Company Description:
Allegheny Technologies Incorporated is one of the largest and most diversified specialty metals producers in the world with revenues of $4.9 billion during 2006. ATI has approximately 9,500 full-time employees world-wide who use innovative technologies to offer growing global markets a wide range of specialty metals solutions. (source: company press release or website)

Why We Like It:
ATI broke down under the $100 level on February 9th following news the night before that ATI had reached a deal with the U.S. steel workers union. Yet there was no follow through on the breakdown and bulls stepped in to buy the dip. Last week's four-day rebound has pushed shares of ATI back above its short-term pattern of lower highs and within striking distance of a new all-time high. The short-term technical indicators are improving and the Point & Figure chart is forecasting a $108 target. We are suggesting bullish call positions with the stock above $100 although more conservative traders may want to wait for a breakout to a new high over $105. Our target is the $109.00-110.00 range.

Suggested Options:
We are suggesting the March or April calls. March options only have four weeks left until expiration.

BUY CALL MAR 100 ATI-CT open interest=2593 current ask $5.80
BUY CALL MAR 105 ATI-CA open interest=2678 current ask $3.20

or

BUY CALL APR 100 ATI-DT open interest=2127 current ask $8.20
BUY CALL APR 105 ATI-DA open interest=1479 current ask $5.60

Picked on February 18 at $102.59
Change since picked: + 0.00
Earnings Date 04/25/07 (unconfirmed)
Average Daily Volume = 2.8 million

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Boeing - BA - close: 90.94 change: -0.77 stop: 87.99

Company Description:
Headquartered in Chicago, Ill., Boeing employs more than 155,000 people in 67 countries and serves customers in 145 countries. Its product lines and services include commercial jetliners, military aircraft, rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles, and advanced information and communication systems. (source: company press release or website)

Why We Like It:
Defense-related stocks have shown a lot of momentum recently and they could get another boost if BA, one of the sector's largest components, breaks out to another new all-time high. The stock has been consolidating under resistance near $92.00 and this past week saw what looks like a mini-breakout from its early February consolidation pattern. We are suggesting a trigger to buy calls on BA at $92.51. If triggered our target is the $99.50-100.00 range. More aggressive traders may want to jump in early on a bounce near $90 or a move over $92.00. FYI: The P&F chart shows a fresh triple-top breakout buy signal with a $107 target.

Suggested Options:
We are suggesting the March or May calls. Bear in mind that March options expire in four weeks.

BUY CALL MAR 90.00 BA-CR open interest=2984 current ask $2.65
BUY CALL MAR 95.00 BA-CS open interest=5688 current ask $0.55

or

BUY CALL MAY 90.00 BA-ER open interest=6574 current ask $4.90
BUY CALL MAY 95.00 BA-ES open interest=5484 current ask $2.40

Picked on February xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 05/02/07 (unconfirmed)
Average Daily Volume = 3.9 million

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Chinese iShares - FXI - close: 106.90 chg: +0.70 stop: 103.99

Company Description:
The FTSE/Xinhau China 25 iShares, symbol FXI, is an exchange traded fund (ETF) tries to mimic the performance of the FTSE/Xinhua China 25 index. (source: company press release or website)

Why We Like It:
The FXI peaked in early 2007 at $118 and has spent the rest of the year consolidating its previous gains. The consolidation pattern formed a neutral pennant shape with higher lows and lower highs. Friday's rally in FXI looks like a bullish breakout from this flag pattern. We are suggesting calls with the FXI above $106.50. We're going to try and get away with a relatively tight stop loss under last week's lows and the 50-dma. Our target is the $114.00-115.00 range. We do expect some resistance near $110 so expect a short-term pull back after testing the $110 region.

Suggested Options:
We are suggesting the March and May calls. Bear in mind that March options expire in four weeks.

BUY CALL MAR 105.00 FJJ-CA open interest=428 current ask $4.30
BUY CALL MAR 107.00 FJJ-CC open interest=180 current ask $3.00
BUY CALL MAR 110.00 FJJ-CF open interest=396 current ask $1.65

or

BUY CALL MAY 105.00 FJJ-EA open interest=509 current ask $7.70
BUY CALL MAY 107.00 FJJ-EC open interest=272 current ask $6.50
BUY CALL MAY 110.00 FJJ-EF open interest=1428 current ask $4.70

Picked on February 18 at $106.90
Change since picked: + 0.00
Earnings Date 00/00/00 (unconfirmed)
Average Daily Volume = 1.9 million

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Research In Motion - RIMM - cls: 138.82 chg: +3.68 stop: 132.39

Company Description:
Research In Motion is a leading designer, manufacturer and marketer of innovative wireless solutions for the worldwide mobile communications market. Through the development of integrated hardware, software and services that support multiple wireless network standards, RIM provides platforms and solutions for seamless access to time-sensitive information including email, phone, SMS messaging, Internet and intranet-based applications. (source: company press release or website)

Why We Like It:
This is a higher-risk, aggressive call play. RIMM can be a very volatile stock and that makes the calls relatively "expensive". Shares of RIMM have been consolidating between $132.50 and $140.00 for just over two weeks now. Some positive analyst comments and a bullish market environment has pushed shares toward resistance at $140 again and RIMM looks ready to breakout. The NASDAQ also looks ready to breakout over the 2500 level and if the market index can do it then RIMM could see more momentum behind its own shares. There is potential resistance near $142.50 and $145.00 at the November and January highs but we suspect that given the current bullishness for stocks that RIMM can trade higher. We are suggesting a trigger to buy calls at $140.51. If triggered our target is the $149.00-150.00 range. We do have a wide stop loss placing it under last week's low. The P&F chart has reversed into a buy signal that points to a $176 target.

Suggested Options:
We are suggesting the March calls. We would prefer to add April or May calls but Junes are the next strikes available. Keep in mind that March options expire in four weeks.

BUY CALL MAR 135 RFY-CG open interest=6636 current ask $8.50
BUY CALL MAR 140 RFY-CH open interest=9435 current ask $5.60
BUY CALL MAR 145 RFY-CI open interest=5772 current ask $3.50

Picked on February xx at $ xx.xx <-- see TRIGGER
Change since picked: + 0.00
Earnings Date 03/22/07 (unconfirmed)
Average Daily Volume = 9.1 million
 

New Puts

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New Strangles

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